The rich keep getting richer while inflation and money printing continue

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GigaAtlasFull Member
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#1Dec 8, 2022, 02:29 AM
So here's the deal: even when the wealthy spend a ton, their cash stays with folks like them. You really gotta focus on getting ahead and climbing the ladder. Even if you're dropping cash on rent or fancy meals, that money just circulates among the rich. People often wonder how the rich keep getting richer even with their spending habits. But spending isn't a bad thing. Like, when a wealthy person buys a yacht, it's not just for fun. It gets them noticed, and other wealthy folks want to network with them. A lot of what the rich do might look like throwing away money, but those pricey experiences actually bring in more connections and opportunities. Anyone can become rich if they leverage what they have. It’s not just about the cash or assets, but also about tapping into the right network and relationships. As long as money keeps being printed, the flow won't stop. Rich people are investing in companies, making sure that money stays with the wealthy. Plus, savvy accountants and lawyers know all the tricks to dodge taxes through offshore accounts and legal loopholes, keeping more cash in their pockets while reducing costs for employees. The current corporate laws really favor making money. Take the example of Thames Water in the UK: investors bought it, borrowed heavily, and then smartly funneled that cash back as dividends to enrich themselves.
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dave.n0deMember
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#2Dec 8, 2022, 03:49 AM
The difference between poor people and rich people is that the rich are ready to take risk and they do not really work for money and save it for inflation to affect it instead they invest it wisely and make more money. Poor is about mentality not how much money that you have. A rich man can decide to invest some money in real estate and some in Bitcoin and after sometime he will now have profit. But a poor man will want to keep that money in the bank for just 1% interest and try to maintain good credit by the time he will now withdraw he will pay tax and inflation will make his money worth lesser.
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paul21Member
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#3Dec 8, 2022, 10:44 PM
Rich people gets richer because that's their end goal. They know and works to make more money out of the money they have. Even if they spend money, they spend it most of the time smartly. They could spend money on luxurious activities or gift but in return, they could get more connections with it. Connection is really essential for rich people. While for the poor, they only have enough money they earn from their job to survive daily. Usually they don't even have enough savings to think of starting a business or even investing to make more money. Though the poor also wants to become rich, but not everyone has the privilege to start investing and make connections. Also, some don't have enough knowledge financially that's why they remain being on the same income class while expenses keeps increasing due to inflation.
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greg.bearMember
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#4Dec 9, 2022, 02:06 AM
The response is simple, rich people buy more assets and poor people buys more liabilities. When rich men makes purchases of expensive things, most times they've ascertained that it has possibility of giving them returns either directly or indirectly or even both, but a poor person would buy an expensive material just to look rich. A rich person plans his expenses and most times save up money separately for an expenses and ends up buying from a fellow rich person and the money circulates within them but a poor person takes money out of his savings to purchase an item from the rich, thereby adding more funds to that already circulating among the rich.
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#5Dec 9, 2022, 05:00 AM
Yeah, this is basically how the cycle keeps looping. Rich people think in assets first. When they buy expensive stuff, there’s usually a reason behind it appreciation, cash flow, tax angle, connections, or long term leverage. Even luxury purchases are often calculated or come after the asset base is solid.
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sam.bullSenior Member
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#6Dec 9, 2022, 09:43 AM
They usually know how to leverage debt While inflation and our financial system supports debt Unlike deflation it's counterpart They use leverage to gain more than they can normally get through equity Finance the debt with the returns and their equity grows
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roguestackFull Member
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#7Dec 9, 2022, 10:04 AM
I get the point you are making, I have a first hand experience about this, back then in school a friend of mine bought a car and we questioned him why he got such an expensive car, but he said he has a reason for doing that, at first we didn't see his reason, but as time went on he started getting big deals from other colleagues and he started getting some contacts that helped so much. People were bringing deals to him because they saw him as a successful person who knows what he's doing while we that weren't that flashy with cars were getting some of the briefs he would reject and pass to us. That was when I realised that the rich who spent money in buying those luxurious things we thought is waste of money are making big money from them and getting more connections for just owning those assets.
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king2011Full Member
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#8Dec 10, 2022, 08:50 AM
You describe world financial structure correctly but it can not be drawned and applied on personal practice/individual availability. Not every rich people understand how money system work and fun fact there are many rich people's son/daughter selling one by one of their parents's asset, going bankrupt and fail inhereted wealth to the next generation, so we can conclude not every rich person can maintain their wealth. Money only a tool, so the real key and problem of being rich and richer is our ability on money management.Without proper understanding of this our welth easily eroded by inflation, our lifestyle and wrong money allocation. The rich people luxury expend based on networking/social investation plan not always working as expected, if they don't know how to change social capital to be economic gain, considering some of luxury item will be expensive liabilities, high class cicle can be turned in to high pressure consumerism or even toxic circle. Unequality of global financial system truly benefited rich people but it is not put rich people in safe place because from my experiences small mistake big money, big mistake more money and wealth only give option not a sucess insurance, wrong partner, wrong time, wrong debt structure, wrong consumption can sinking rich people to bankrupt. From my point of view, the main problem of money management is when productivity inverse with lifestyle and ignorance to financial literacy because overconfidence that money always stay in their pocket. Many rich people kids when inhereted parent's wealth not automatically adopt their parent's success pattern.
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